Blockbuster Inc. has begun testing vending machines that rent new movies for $1 a night in Papa John’s International Inc. and Family Dollar Stores Inc. locations this week in Lexington, Ky.
That’s $3 less than a 5-day rental at Blockbuster stores.
Blockbuster Express boxes, each offering 250 movies, are in 3 Papa John’s locations and 7 Family Dollar sites, Blockbuster spokeswoman Karen Raskopf said.
The vending machines may help Dallas-based Blockbuster fend off DVDPlay Inc. and Redbox Automated Retail LLC, jointly owned by McDonald’s Corp. and Coinstar Inc. The 2 companies have been offering $1 DVD movie rentals at supermarkets, drugstores and McDonald’s.
Blockbuster has ‘an opportunity’ with the self-serve stations, said Arvind Bhatia, an analyst at Sterne Agee & Leach Inc. in Dallas, who recommends investors buy the shares. ‘It’s a question of whether can they execute. Almost overnight, without having to go any place, they can very, very quickly put these kiosks in their stores to start with.’